SEC Sets Up Five-Year Temporary Framework for Limited Trading in Tokenized U.S. Stocks

CoinDesk reports that the U.S. Securities and Exchange Commission said Thursday it will allow a limited, temporary framework for trading tokenized shares of U.S.-listed companies. The arrangement is not a formal rule change and can run for up to five years. Markets took the move as a constructive step for tokenized securities. Shares of Securitize, a U.S.-listed tokenization firm, jumped as much as 24% intraday before trimming gains to around 14%, reflecting expectations that established issuers and infrastructure providers could be among the main beneficiaries. The SEC described the measure as an "innovative exemption" intended to ease long-standing challenges in rolling out compliance-focused innovations in U.S. markets while preserving investor protections and market integrity. The approval remains narrow in scope, applying only to tokenized publicly traded stocks on select platforms. Tokenization generally involves recording ownership of real-world assets such as stocks and bonds on a digital ledger. Proponents argue it can extend trading hours and improve liquidity, positioning it as a complementary option alongside traditional market infrastructure. Securitize, one of the larger U.S. tokenization platforms that launched in early July, holds roughly 9% of the tokenization market by assets under management. Needham Securities has said long-term leaders are more likely to emerge from platforms that can attract a broad institutional client base, citing Securitize's fund launches with BlackRock, Apollo and KKR, as well as infrastructure partnerships with Computershare and the New York Stock Exchange. The broader tokenized-asset market continues to expand. Data from RWA.xyz showed that as of Thursday afternoon, total tokenized-asset market capitalization reached $38.51 billion, up more than 70% from a year earlier. Regulatory pilots and growing institutional participation remain the primary drivers. While the SEC's temporary pathway stops short of a comprehensive regulatory overhaul, it creates room for additional testing of tokenized U.S. equities in the market.